Germany Facility Management Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The Germany Facility Management Market is expected to register a CAGR of above 3.58% during the forecasted period 2022-2027. The growth in German facility management services is attributed to the increasing demand for customized solutions for different in-house and outsourced facility management. Moreover, the rising number of commercial and residential buildings in major cities is further pushing the demand for facility management services across the country.

Key Highlights

• The growing investments in commercial properties are expected to increase the demand for facility management services in the region. It is quite evident with the recent developments happening in the country. For instance, in August 2021, Google is opening a new Google Cloud region in Berlin-Brandenburg, with investment plans in renewable energy. The company plans to further invest in Germany’s transition to a digital and sustainable economy. The company plans to invest approximately EUR 1 billion in digital infrastructure and clean energy by 2030.
• Additionally, rapid infrastructure development along with the rising focus on integrated facility management services is anticipated to positively influence Germany facility management market over the coming years.
• Further, the facility manager's role is growing more notable and even changing from operational to strategic. This COVID-19 pandemic is an opportunity for the facility manager to consolidate the new office environment and the demands of employees in terms of working from home into the corporate culture. Though, more compliance is anticipated, also concerning suppliers. The focus will be more on quality and results and smaller on a fixed schedule.

Key Market TrendsIncreasing Demand for Customized Solutions

• Despite the tremendous income potential of outsourced FM, services are becoming more commoditized across Europe, and organic growth is difficult to come by. Service integration and advanced advisory services focusing on productivity, user experience, and sustainability will become the norm in the business. According to CBRE Group, technology is fueling interest in managed workspace and co-working, with 60% of occupiers believing serviced offices will play a part in managing their accommodation needs in the next three years.
• Co-working will entail numerous different organizations, businesses, and individuals sharing space, similar to managed workspace, where space and facilities are provided by a third party. The co-working revolution, as it has been labeled, reflects a growing demand among professionals and creatives for autonomy, a lack of hierarchy, flexibility, and community.
• The growth in German facility management services is attributed to the increasing demand for customized solutions for different in-house and outsourced facility management. Moreover, the rising number of commercial and residential buildings in major cities is further pushing the demand for facility management services across the country. Additionally, rapid infrastructure development along with the rising focus on integrated facility management services is anticipated to positively influence the studied market.
• Further, in July 2021- Intel announced to invest of USD 20 billion to begin constructing eight chip plant facilities in Belgium, Germany, France, and the Netherlands in early 2021. Such developments are driving more opportunities for vendors to have security services for facility management. Overall, with increased expansion of manufacturing facilities in the region is expected to drive the demand for facility management.

Growing Investments in Commercial Properties

• According to Savills, a real estate company, approximately EUR 22.9 billion was invested in German commercial property during the first half of 2021. With EUR 13 billion, the investment volume in Q2 was the second-highest of any quarter since the outbreak of the Covid-19 pandemic in the country but remained around 17% below the five-year average quarterly volume prior to the pandemic.
• Thus, the growing investments in commercial properties in further expected to increase the demand for facility management services in the region. It is quite evident with the recent developments happening in the region. For instance, in August 2021, Google is opening a new Google Cloud region in Berlin-Brandenburg with investment plans in renewable energy. The company plans to further invest in Germany’s transition to a digital and sustainable economy. The company plans to invest approximately EUR 1 billion in digital infrastructure and clean energy by 2030.
• Modern offices with long-term tenants remain highly sought-after by investors despite all the discussions surrounding hybrid working. The growing business acumen among industry leaders and diversification of the economy from automobile industries to other avenues is expected to increase the demand for facility management services in the country.
• Moreover, in October 2021, SPIE, an independent multi-technical services provider in the areas of energy and communications, renewed its partnership with Siemens Energy for the coming three years. The multi-technical service provider will be responsible for the technical facility management of 385,000 square meters of office and production space occupied by Siemens Energy.

Competitive Landscape

The Germany Facility Management Market is moderately competitive with the presence of diverse firms of different sizes. This market is anticipated to encounter a number of partnerships, mergers, and acquisitions as organizations continue to invest strategically in offsetting the present slowdowns that they are experiencing. The clients in this region are employing FM services to increase the ease of their business operations. The market comprises key solutions and service providers, such as Strabag SE, Bilfinger SE, Dussmann Group, Wisag Facility Service Holding GmbH, and Compass Group PLC.

• February 2022 - Bilfinger signed a memorandum of understanding (MoU) with Rock Tech Lithium on the construction of German facility. As per the MoU, Bilfinger would be overtaking engineering services, procurement services, and construction management services.

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